physical inventory (1)

Controller’s Office

Department Asset Custodian

Training

Controller’s OfficeCapitalized Asset

Management


Introduction

“The head of a custodial department and the Principal Investigator have primary responsibility for the care, maintenance, records, physical inventory, control, and disposition of inventorial equipment and other University or extramurally-funded property.” UCOP – BUS-29, Section C


IntroductionIntroduction

The purpose of this workshop is to acquaint YOU as asset custodians with policies and procedures, tools and resources that are available to you in caring for the University’s capitalized assets.

You can thus fulfill the goal of safeguarding the high-value assets of the University in the best manner possible.


Who Are Those Guys?

CAM is a part of UCSF Controller’s Office Capital Accounting. It is responsible for: Maintaining a database of asset information in the

PeopleSoft Enterprise Online Financial System, Capitalizing assets purchased, leased, donated or

transferred to UCSF, Monitoring campus-wide adherence to University

policies and guidelines, Maintaining inventory controls and accountability

systems, Organizing and implementing the campus-wide

biennial physical inventory


Who Are Those Guys? (continued)

- Reviewing and approving asset transfers to other UCSF departments, UC campuses or non-UC entities,- Reviewing and approving the disposal of

excess property in accordance with applicable policy and regulations and - Providing consolidated reporting to UCOP and

other funding agencies.


A couple of definitions…

Capital Asset - Any purchase of physical equipment with a cost greater than or equal to $5000- (including sales tax, start-up supplies, delivery, and installation) with a useful life greater than one year.

For example, if you purchase a piece of equipment for $4800- it will most likely be considered a Capital Asset after taxes, etc.

Custody Code – The custody code is a 4-digit code issued by CAM at the behest of the department. Each custody code requires a custodian who is responsible for tracking the equipment. Departments are required to supply a custody code number to Procurement Services when a requisition is created.

Steps in the purchase of Inventorial equipment


Steps in the Purchase of Inventorial Equipment

Purchase Order generated in BearBuy◦ At this time the Capital Equipment form should be used and

your custody code should be assigned by the requestor/purchaser.

Purchase Order in BearBuy

Capital Equipment Form


Use this form for any Capital Equipment Purchase or Capital software purchase


Be sure to fill in the custody code under the “Asset Management” tab on Purchase Order


Purchase Order generated in BearBuy◦ At this time the Capital Equipment form should be used and

your custody code should be assigned by the requestor/purchaser.

Get to know/contact the purchasers for your department. If you do not know who they are, get in touch and I’ll send you a list. Familiarize them with your code & when to use it.


CAM (Capital Asset Management)reviews the PO:◦ Assigns an EQ code (this is a code used to establish useful life of equipment) ◦ Assigns a tag# (You will receive the tag with tag form shortly after to fill out).

Property Tag

Custodian Receives Tag:◦ Affix tag to associated equipment◦ Review description and send back the model

number, serial number, and location


Role of the CustodianRole of the Custodian

Liaison between CAM and the Department Primary contact point for Department Provide current information to CAM to assure accurate

records Insures University and Federal requirements are met (i.e.

donations, transfers, disposals, etc.).


DefinitionsDefinitions

For discussion purposes today the only definitions that will be included are those required to create an asset file in PeopleSoft and for reporting to UCOP. However, the manual lists many others and the custodians should be familiar with all of them.


DefinitionsDefinitions (continued) (continued) - CAAN/Location – An up to 8-digit code representing building AND room.

Federal Regulations require both building and room number. - Custody Code – The custody code is a 4-digit code issued by CAM at the

behest of the department. Each custody code requires a custodian who is responsible for tracking the equipment. Departments are required to supply a custody code number to Procurement Services when a requisition is created.


Definitions (continued) Inventorial Equipment – A single unit, freestanding, non-expendable, with a cost (including sales tax, delivery, and start up accessories and

supplies) equal to or greater than $5,000.00. Property Number – A nine-digit number printed onto a barcode tag that is

affixed to the equipment as a unique identifier.


Definitions (continued)

Groupings within the 9 digits – nn+nn+n+nnnnFirst two digits –year asset was added to the

asset inventory (last 2 digits) Second two digits – UC Campus that originally

acquired asset (e.g. 10=Berkeley; 20=S.F.)Fifth digit (under UCSF) - 0 for Campus, 3 for

Gallo Clinic, 5 for Medical Center, and 9 for Vehicles.

Last four numbers - issued sequentially to uniquely identify each asset.


DefinitionsDefinitions (continued) (continued) Manufacturer – The company that produces or OEMs the equipment Model Number – The number assigned by the company to identify specific

versions of equipment. Description – This is a simple one or two-word field to help the custodian

locate equipment. EQ Code – A 5-digit (one alpha and 4 numeric number) code that is based

on the type of equipment and is used by UCOP to calculate depreciation.


Primary Responsibilities

1) Change of Custodian Custodian Maintenance Form

2) Property Tag3) EIMR form

All additions to inventory All removals of equipment

4) Biennial Physical Inventory5) Physical Inventory Audit


Change of CustodianChange of Custodian

Fill out Custodian Maintenance form.Include all custody codes the change is

applicable to.Obtain approval (sign off) from the Financial

Administrator or Business Officer.Send or email the form with Section 2

completed to CAM.


Property Tag


Provided by CAM

Let’s us know what you want to do.Item Description1) Surplus2) Transfer to another department3) Sale

4) Remarks, always includeSignatures


New AssetsNew Assets Equipment may be added to a department’s

inventory in the following ways:- A Purchase Order is processed through Procurement Services.- A Lease Agreement > $100,000 total value- A department receives a gift (cleared by Development Office)- Equipment is transferred from another institution or UC Campus- Equipment is borrowed from an outside institution


Principles of Equipment Disposals

A department may dispose of equipment ONLY IF the University holds title.

An EIMR must be submitted whenever equipment is to be removed from a department’s inventory.


Retiring Assets

1) Send to Surplus Sales for public sale or disposal.2) Destroyed or cannibalized for parts3) Stolen. EIMRs reporting stolen equipment

MUST include a police report number. 4) Intercampus Transfer

- letter from department head- Other campus EIMR with signature of recipient campus equipment manager- EIMR from department

5) Lost


Retiring Assets (continued)6) Donate to a non-profit or educational institution. The following procedure must be followed per BUS-38:

- Requesting agency submits request on letterhead- Dept Head verifies in writing that equipment is no longer useful in dept- Department submits request, letter, and EIMR to CAM.

7) Sold to another non-UC non-profit entity in conjunction with faculty move.


Physical Inventory - PurposePhysical Inventory - Purpose

The reason for the physical inventory is to produce an accurate inventory through:Physically locating equipment that is in use, Removing from the database equipment not found, and Adding high value equipment which is being used but is

not included in the asset list.Updating existing equipment attributes (Description, Mfg.,

Model, Ser. ID, etc.)


What Is At Stake?What Is At Stake?

Federal funding requires system-wide compliance with their asset management policy and procedures

Certification as a Federally compliant research facility is contingent on adherence to established guidelines

UC Office of the President financial reporting requires up-to-date inventory information

Campus Facility and Administration (F&A) rate is affected and

Insurance payments in case of loss, theft, or disaster hinges on substantiation of location recorded in the system.


Physical Inventory – ProcessPhysical Inventory – Process

Per State and Federal regulations complete inventory of campus and medical center required every 2 years.

CAM will provide custodian with a list of equipment by custody code.

Custodian embarks on search or organizes search party to locate and verify each piece of equipment listed.

Physical Inventory Process (Continued)Physical Inventory Process (Continued)

The notification email will include the following attachments:

List of AssetsList is arranged first by building code/room number, then by property tag number and furnished in both PDF and Excel file formats.

Instruction SheetLink to online tools

Tools include schedules, forms, building code lists, comprehensive information and instructions and other resources helpful toward a successful completion.

10/4/2013

PROCESSES


Process (continued)Process (continued)

During the inventory process the custodian should verify the following attributes which can be changed if necessary:Location - Building (CAAN) and room numberDescriptionManufacturer/Model NumberSerial Number (should be provided if not listed)


Process (continued)Process (continued)

Attributes that cannot be changed by the department are:- Property Tag Number - Cost- Original Dept ID/Fund


Physical Inventory – Field AuditPhysical Inventory – Field Audit

All submittals for a particular month are subject to a random sampling audit. CAM randomly selects 10% of the asset population sent in during the targeted

month. CAM emails custodian with assets to be verified clearly identified. A CAM team member and the department asset custodian travels to the

location specified in the physical inventory findings by appointment to confirm accuracy of reported data.

An error rate of 10% or less of sample population constitutes a successfully-completed physical inventory.

An error rate of greater than 10% requires a second random sampling audit.

If the second audit is unsuccessful, all custodial departments submitting physical inventories for the target month will need to re-take their physical inventories.

PROCESSES


Physical Inventory – SummaryPhysical Inventory – Summary

The departmental physical inventory is considered complete when:

Custodian returns listing with corrections;CAM enters corrections and sends the updated

inventory report to custodian;Custodian and department head signs off that the

inventory report is accurate; Statistical sampling audit produces 10% or fewer

errors.

PROCESSES


Where’s the Help?Where’s the Help?

Asset Custodian Training Workshops held periodically

Controller’s Office Website at: http://controller.ucsf.edu/ Capital Accounting & Equipment

FAQs Policies Procedures & Job Aids Training Forms Contacts

Department Asset Custodian Manual handed out at the workshops and available for viewing or printing from Controller’s Office website

WebLinks Asset Management Report (AM) module accessed for historic equipment information

Desktop Training Program, one-on-one training for asset custodians. CAM sends a team member at department’s invitation to discuss the responsibilities of the position, how to access online resources and any unique challenges the custodian faces.

Controller’s Office Monthly Electronic Newsletter

EPILOGUE

• http://controller.ucsf.edu/



Overview – Introductory information if you are new



Forms related to capital accounting

http://cpbc.ucsf.edu/

Who Can I Call?Who Can I Call?

“If I can’t help, I will find someone who can.”

EPILOGUE

• Physical Inventory Contact – Terence Hurley [email protected] 415-502-2657

• Equipment Accounting - Angela Farren

[email protected] 415-502-5642

• Equipment Invoices - Jim Antuk


• Capital Accounting Supervisor – Renee Boyd [email protected] 415-502-3042

• Capital Accounting Manager – Amy Nichelini


The End

physical inventory (1)

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